TaxTMI 
TaxTMI 
1988 (11) TMI 236
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....he respondents are the manufacturers of fertilizers. They manufacture in two different units one situated at Kandla and another at Kalol. They were permitted to avail exemption under Notification No.198/76, dated 16-6-1976 in respect of Indian Farmers Co. Ltd. As required by the Notification and orders issued in connection with such Notification, the respondents have applied for approval of the base clearance of both the units separately. Co-ordinating Assistant Collector approved the base clearance in respect of each factory vide his letter dated 11-2-1977. On the basis of approval so given, the respondents herein began availing the benefit of the Notification No.198/76 in respect of each unit. On this basis they filed their RT-12 returns ....
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....ce earlier fixed. Therefore, to that extent there was wilful suppression of material facts on the part of the respondents herein. He, therefore, contended that the Collector (Appeals) committed an error in taking a view that the demand is barred by time. 6. Shri Lachman Dev, appearing for the respondents, however, submitted that the basis for the demand is the audit report, wherein the audit appeared to have pointed out that there was short recovery of Central Excise duty and, therefore, a show cause notice came to be issued. Shri Lachman Dev submitted that the allegation of wilful suppression of material facts is totally unfounded and has no basis. He urged that in his letter dated 11-2-1977 the Co-ordinating Assistant Collector ha....
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....ly on the application made by the respondents the Co-ordinating Assistant Collector did fix the base clearance quantity. He had fixed the base clearance quantity for each unit. In his letter dated 11-2-1977, the Assistant Collector (Co-ordinating Unit) inter alia stated : "In respect of Kalol Unit the base clearance MT 72,239.21 will exhaust by the end of the clearance covered by Gate Pass No. 252, dated 5-7-1976. Therefore, the clearance for the period from April to June, 1976 and a part of July, 1976 will complete the quantity of the base clearance with the issue of G.P. No. 252, dated 5-7-1976. As such from G.P. No. 253, dated 5-7-1976 onwards, the unit is eligible for duty relief at the rate of 25%." In the same letter in paragrap....
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....e fixed as 1,10,713.410 M.T. and individual figure of base clearance for Kandla and Kalol unit separately. This leads me to conclude the licensee has deliberately and wilfully taken excise relief of 25% with reference to his individual base clearance instead of combined clearance as per above Notification...... Accordingly, the application of Rule 10 under which show cause notice issued is appropriately applied and therefore, in this case the period of six months would be read as period of five years." 9. Having regard to his above finding the Assistant Collector confirmed the demand of Rs. 32,32,826.35. 10. The Collector (Appeals),- however, did not agree with the Assistant Collector and he held that the demand was barred and ther....
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....ion lists filed by the department were accepted by the department, so also the RT-12 returns. It could have been open to the department to take objection as to the classification lists when the respondents showed the quantity and also mentioned the availment of Notification No. 198/76. No such action had been taken. Similarly, at the time of finalisation of RT-12 returns there was one more opportunity for the department to correct the availment of concessional rate of duty. Even at that stage the department did not act. All that the department seeks to establish in this case is that the assessee, namely, the respondents herein did take certain advantage in the matter of duty. But then, it is not sufficient if the department establishes that....